The tourism industry is vital to the UK economy. Tourism is a major contributor to employment across the country, working hand in hand with a number of different industries from entertainment to travel to retail. Visit Britain estimates that by 2025, the UK will have a tourism industry worth over £257 billion.
That being said, there’s a growing concern that proposed Brexit immigration plans, set to come into force in 2021, will result in staff shortages and even closures for tourism businesses.
Though there is still uncertainty about what the Brexit deal will be, and how it will directly impact all businesses, there are ways in which you can be prepared for any outcome.
What are the proposed immigration changes?
From 2021, the government plans to implement a salary-assessed system for workers in all industries being recruited from outside the UK.
The minimum-salary required for a visa to work in the UK is set to be £30,000 a year.
- Workers from the EU already residing in the UK will need to apply for a status via the EU Settlement Scheme in order to continue working. Anyone who hasn’t applied by 2021 will be subject to the new salary-assessed rules.
- There will be a transitional period, whereby new low-skilled workers can apply to work in the UK on a 12-month visa, but those workers will not be permitted to reapply at the end of the twelve months.
What are the challenges?
How to fill the low-skilled jobs
The average salary of a worker in the tourism industry is estimated to be £17,000, meaning that many UK workers wouldn’t reach the proposed requirements for a permanent visa, let alone workers coming from outside the UK to take up low-skilled jobs.
It’s filling the low-skilled jobs that tourism business owners are most worried about. The fear is that it’ll become exponentially more difficult to employ staff for jobs categorised as ‘low-skilled’ post brexit. These are bar, house-keeping and front of house staff.
Recent research from UKinbound and Canterbury Christchurch University found that almost half of the tourism businesses in London rely on EU nationals for more than half of their workforce.
The challenge to recruit staff for low-skilled jobs isn’t necessarily a new one. However, with EU workers taken out of the equation, business owners fear they will encounter even more of a difficulty in recruiting UK workers, who are less likely to apply for minimum wage, low-skilled jobs.
The demand for foreign language speakers
The secondary problem you may face is the demand to find UK workers with the foreign language skills required in some tourism roles. Since the EU referendum, the government has been called upon to recognise that language skills are key skills that will be put at risk if and when a brexit deal goes through.
UKinbound have called for:
- Language skills to be added to the occupation shortage list
- The salary threshold proposed to be regionally set, to take into account lower salaries in tourism hotspots outside of the capital
- A quarterly independent review to assess the effects on the tourism industry
How you can prepare
We appreciate that it’s difficult to be fully prepared on ‘what if’s’. When we have a solid conclusion on the ins and outs of a brexit deal (or no deal), we’ll advise on the best steps to take. However, there are ways in which we can help you be prepared now, regardless of what the outcome is.
- Understand your finances now, and calculate the potential risk
For a start, we can make sure your finances are in the best shape now, and look for ways in which you can improve on the efficiency and profitability of your business. We’ll ensure you’re making the most of tax reliefs available to you, and create forecasts to predict cash flow and profit in the coming years. When you know how your business is performing, and how it is predicticted to perform, you can anticipate future pitfalls, and can plan ahead of them instead of being surprised by them.
- Look at the current skills gaps in your business
When you know your financial position now, and you have accurate and effective forecasting, you can begin to look at the skills gaps you have and plan for how you might fill them. You may be able to strategise ahead of time to get the most out of your existing workforce, or run an informed hiring campaign to begin looking for UK workers for your low-skilled jobs. You’ll also have more of an understanding of the budget you’ll have for salaries.
- Stay up to date with HMRC’s preparation advice for a no-deal brexit
As we wait to hear more about the brexit deal, it can be helpful to keep an eye on the advice from HMRC should we be looking at a no-deal brexit. The checklist is designed to help you think proactively about your existing employees, customers and business infrastructure.
Instead of worrying ahead of time, put plans in place ahead of time. Brexit aside, it’s our job to help our tourism clients stay informed and empower them to build a strong business that can survive any roadblocks that come their way. Take a look at our tourism specific page to see how we do that.